On Friday, 30 January, three days after I had assumed the ministry, the president of the Eurogroup, Dutch finance minister Jeroen Dijsselbloem, dropped in. He came with a large entourage that included Thomas Wieser, president of the Eurogroup Working Group and the true power broker within the eurozone. I waited for them by the sixthfloor lift. We met, shook hands warmly and proceeded to my office for some refreshments before moving to an adjacent conference room, the two teams facing each other across a large rectangular table.

On my side of the table I had my two alternate ministers plus Chouliarakis, chair of my Council of Economic Advisers, Stathakis, economy minister, whose office was one floor above mine, and Euclid. Among the heavyweight troika officials on Dijsselbloem and Wieser’s side was Declan Costello, an Irishman famous even in Ireland for his hardline policy towards indebted nations, now the European Commission’s mission chief for Greece, plus the Dutch ambassador to Greece. Dragasakis made a short welcoming speech then left the room immediately. I followed up with a welcoming speech of my own before Jeroen Dijsselbloem said a few words on behalf of the Eurogroup. Niceties were exchanged and good intentions were aired in what can only be described as a tense encounter. Then the moment of truth arrived when I invited Jeroen into my office for a tête-à-tête.

With the door closed behind us, I attempted to melt the ice by sharing the words of optimism with which I had closed my inaugural press conference a few days earlier. Let’s defy the prophets of confrontation, I proposed. Let’s prove wrong the media who imagine this to be some High Noon encounter. I assured him that our new government was only interested in compromises on a path leading to a mutually advantageous agreement. But to assist the birth of this new partnership, we would need to work out a better negotiation process, one that was not injurious to the Greeks’ sense of pride. The troika’s methods in Greece over the past five years had been counterproductive.

‘Yes,’ he agreed. ‘The troika has not left the best impression here.’

‘That’s a major understatement, Jeroen,’ I said with a smile. I urged him to see it from the perspective of the people on the ground. For years now groups of technocrats dispatched by the IMF, the European Commission and the European Central Bank had arrived at Athens airport, from which they had been driven at high speed under police escort in a convoy of Mercedes-Benzes to the various ministries, where they had proceeded to interrogate elected ministers and dictate to them policies that affected the lives of millions. Even if these policies had been wonderful, they would have been resented. ‘We must find another way to work together,’ I said, one that would allow our people to embrace whatever policies he and I agree upon. At the very least, Greece’s elected ministers should not be expected to conduct their business with anyone other than their elected equals; technocrats could prepare the ground, establish the facts and the figures, but should not conduct the ministerial negotiations.

I was happy to hear him say that, yes, he agreed that the process would have to be reconsidered, although in hindsight I suspect his accommodating attitude was less to do with an appreciation of what I had been saying and more to do with his evident eagerness to change the subject and return to the same question he had posed on the telephone a few days earlier: ‘What are your intentions for the Greek programme? Are you planning to complete it?’ he asked.

I repeated the answer I had given him over the phone: our new government, I replied, recognized that it had inherited certain commitments to the Eurogroup while at the same trusted that its partners would recognize in return that it had been elected only a few days before in order to renegotiate key elements of this programme. His response was abrupt and aggressive. ‘This will not work!’ he declared.

I reminded him that when I had given the same answer to the same question three days earlier, he had replied, ‘This is very good.’ Jeroen brushed my reminder aside. The Greek programme, he mused, was like a horse. It was either alive or it was dead. If it was alive, we had to climb on it and ride it to its destination. If it was dead, then it was dead. Not knowing what to make of his metaphor and unwilling to adopt it, I tried to reason with him.

There was a reason, I explained, why the previous government had fallen on its sword and called elections so early in its term. And there was a reason why Antonis Samaras had been sent to the opposition benches by the voters who had elected us instead. And the reason was simple: it was simply impossible to complete the second Greek programme, and the voters understood that. ‘If it could have been, Jeroen, you and the previous government would have completed it,’ I remarked.

For a moment he seemed lost for words, so I continued: the troika’s own numbers showed that even if the programme was completed and Greece received the few billions left in the second bailout kitty, we would still be €12 billion short. Where would I find a missing €12 billion? Think of the effect this unanswered question is having on private investors, I urged him: it reinforces their resolve not to lend to the Greek state again until a serious restructuring of our debt has been effected. And think of the broader picture too, I implored him: the government’s debt repayments in 2015 alone amounted to 45 per cent of all the taxes it hoped to collect; meanwhile, national income, measured in euros, continued to fall, and everyone was anticipating an increase in taxes to meet the repayments. No investor in their right mind invests in an economy where demand is shrinking and taxes are rising.

There were only three options available to us, I said. One was a third bailout to cover up the failure of the second, whose purpose was to cover up the failure of the first. Another was the new deal for Greece I was proposing: a new type of agreement between the EU, the IMF and Greece, based on debt restructuring, that diminished our reliance on new debt and replaced an ineffective reform agenda with one that the people of Greece could own. The third option was a mutually disadvantageous impasse.

You do not understand, Jeroen told me, his voice dripping with condescension. ‘The current programme must be completed or there is nothing else!’

It was an astonishing statement. The head of the eurozone’s finance ministers was refusing to engage with a simple funding issue. He was making it impossible for me not to ask, ‘But where will the missing €12 billion come from, Jeroen? Am I wrong that the second programme can only be completed if a third one is first negotiated? Can you see any way that would render its completion financially feasible without a new programme that can only be agreed to after exhaustive negotiations between all nineteen finance ministers [in the Eurogroup]? Is there any doubt that I will not be able to complete this programme even if I were willing to violate the mandate that the Greek voters gave me to renegotiate it?’

Jeroen refused to engage with my questions and the underlying facts. Apparently he had not come to Athens to discuss numbers or financing. One could only assume that he had come instead in the expectation that I would perform an instant U-turn – a quick victory allowing him to board his jet at Athens airport with my oath of allegiance to the programme, to the Eurogroup and to the creditors in his briefcase.

The fact that the president of the Eurogroup was so deluded as to think this was a possibility is a fascinating comment on the recent history of the European Union. It reveals how experience has taught functionaries operating on behalf of Europe’s deep establishment to expect newly elected government ministers, prime ministers, even the president of France, to buckle at the first whiff of an ultimatum backed by the ECB’s big guns. Since 2008, when the only thing keeping most eurozone member states’ commercial banks open was the Eurogroup’s goodwill – which Mario Draghi’s ECB needed in order to issue the official waiver that allowed him to accept the banks’ junk collateral in return for cash – several governments had succumbed to policies they detested: the Baltic states, Ireland, Cyprus, Spain, Portugal, all had been beaten into submission. In fact, Dijsselbloem had boasted that the way Cyprus had been treated in 2013, soon after he had taken over the Eurogroup presidency, was the ‘template’ for future crises. It was the threat of bank closures that had done it – this was the ace he carried in his sleeve on the day of his visit to me – and now he played it.

There was an alternative to committing to completing the programme, he told me. I was glad to hear it, I replied hopefully. Turning his eyes to meet mine, he said purposefully, ‘You and I hold a joint conference where we announce that the programme has crashed.’

I replied that the word ‘crash’ was not exactly soothing for markets and citizens. What do we replace it with? I enquired.

A shrug of his shoulders and a look of faux puzzlement was his response.

‘Are you threatening me with Grexit, Jeroen?’ I asked calmly.

‘No, I have not said this,’ he protested.

‘Can we please be frank here?’ I said. ‘There is too much at stake to pussyfoot around. You did say that if I insist on renegotiating the programme, the programme crashes. This means one thing and one thing only. And we both know what that is.’

It was of course that the ECB, either centrally or through the Central Bank of Greece, withdrew its waiver and refused to accept the collateral of Greek banks any more, forcing them to close. At that point our government would have no option but to issue its own liquidity. And if the impasse continued our nominally euro-denominated liquidity would, at some point, turn into a new currency. This was Grexit.

‘So, you are giving me an ultimatum,’ I continued. ‘You are in effect telling me: commit to a programme that cannot work or you crash out of the eurozone. Is there any other reading to what you just said?’

The president of the Eurogroup shrugged his shoulders again and grinned.

‘It is a sad day for Europe when the Eurogroup president presents a freshly elected finance minister with an impossible ultimatum,’ I said. ‘We were not elected to clash with the Eurogroup, and I am not interested in clashing with you. But nor were we elected to abdicate during our first week in office by espousing an impossible programme that we came in with a mandate to renegotiate.’

Our eyes met in mutual recognition of the impasse. The only thing left to do was to agree on what each of us would say during the press conference scheduled to follow our meeting, so as to conceal the deadlock and thus prevent it affecting the financial markets. He proposed a first draft; I made a couple of corrections; we agreed. I suggested that, after the speeches, it would be best to take no questions. He countered that we had better take a couple. Answering journalists’ pointed questions would give him the opportunity to jangle the markets’ nerves just a little – enough to accelerate by a notch or two the bank run that the troika had kick-started weeks before. Loath to be portrayed as muzzling the press, I agreed.

The press room was packed. Once the TV feeds had been established and the noise subsided, I began with predictable niceties consistent with my narrative of a new beginning in Greece’s relationship with its creditors and the Eurogroup. Every word had been agreed beforehand. He too respected our agreement and did not stray from the script as we laid a veneer of boring normality over the meeting. Then came the questions.

The first was addressed to Jeroen. Would he be agreeable to the convening of an international conference on Greece’s debt, similar to that in London in 1953, which had resulted in substantial debt relief for Germany? He responded flippantly that Europe already had a permanent debt conference – the Eurogroup! I smiled at his answer, making a mental note to use it myself if an opportune moment presented itself.

The second question was addressed to me. Would I cooperate with the troika? My answer was fully in line with what I had told Jeroen in my office: ‘We must be clear in our minds about the great difference between the properly instituted institutions of the European Union, such as the European Commission and the European Central Bank, as well as international institutions such as the IMF – organizations and institutions to which Greece proudly belongs – and a tripartite committee that is associated with the imposition of a programme that our government was elected to challenge and to dispute. Our government will proceed under the principle of maximum cooperation with the well-constituted legal institutions of the European Union, and of course the IMF. But with a tripartite committee whose objective is the enforcement of a programme whose logic we consider to be anti-European, with that committee, which even the European parliament considers to be flimsily constructed, we have no intention to cooperate.’

It was the same point that I had just made to Jeoren in my office and with which he had reluctantly agreed: yes to working closely and well with the institutions, but no to the humiliating troika process. As he listened in his earpiece to the translation of my response, an expression of increasing disapproval appeared on his face. When the translation finished, he angrily removed his earpiece and leaned over to whisper in my ear, ‘You just killed the troika!’

‘Wow!’ I answered. ‘This is an unearned compliment.’

Turning away, Jeroen jumped to his feet to storm out. But I had managed to stand up at the same time and offer him my hand. Somewhat thrown by my gesture, and as he had to walk past me to reach the exit, he awkwardly took my hand in his without stopping. The photographers pounced. Their pictures showed an ill-mannered Eurogroup president rudely brushing past me before the customary handshake had been completed.